Exploration of 'Directing Mind and Will' in Corporate Law

The project delves into the intricacies of 'Directing Mind and Will' within corporate law, analyzing how courts discern the individuals whose actions are binding on a corporation. It discusses foundational cases like Lee v Lee's Air Farming Ltd (1960) and Krakowski v Eurolynx Properties Ltd (1995), which establish that not all employees embody the company's will but only those authorized to fulfill its objectives do. Additionally, it scrutinizes 'Piercing the Corporate Veil', a legal principle enabling courts to hold directors personally accountable for corporate misconduct under specific conditions such as fraud or sham operations. This concept is pivotal in ensuring justice by circumventing the protective barrier of limited liability. Key cases like Lennard’s Carrying Co Ltd v Asiatic Petroleum Co Ltd (1915) are referenced, demonstrating circumstances where this veil can be pierced, emphasizing its significance in corporate law.

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Cover page
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Student ID
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Contents
Part 2...........................................................................................................................................................3
A. Directing Mind and Will..................................................................................................................3
B. Piercing the Corporate Veil.............................................................................................................3
Bibliography................................................................................................................................................4

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Part 2
A. Directing Mind and Will
Directing mind and will is a phrase that is associated with the officers of the company who are
considered to be the minds of a company. When any company is formed then it acquires all the
features of a natural person and is established in (Salomon v A Salomon & Co Ltd, 1896). The
officers of the company are distinct from the company and the acts of the company are
considered to be its own and no repercussion falls upon the officers who acts as the agents of the
company and is held in (Lee v Lee's Air Farming Ltd , 1960). (Tomasic, Bottomley, &
McQueen, 2002)
But, whether every person who is acting on behalf of company can be considered as the
‘directing mind and will’ of the company. Can every employee or client who is associated with
the company is the ‘directing mind and will’ of the company. The answer is No.
It is held in (Krakowski v Eurolynx Properties Ltd, 1995), that those officers who encompass and
acts in order to fulfill the objects and aims of the company are considered to be the directing
mind and will of the company. These are the persons who are authorized to achieve the purpose
of the company and are entitled to undertake actions on behalf of the company. The acts that are
carried out by theses ‘directing mind and will’ official are binding upon the company and the
company must honor such acts considering the same as its own. (Tunstall, 2008)
B. Piercing the Corporate Veil
Piercing the corporate veil is the phrase which symbolizes a situation where in the distinct
personality of the company is disregarded by the court and the distinction amid the company and
its officers is mitigated and the acts of the directors are held to be his acts personally and not the
acts of the company. (Eroglu, 2008)
When a company is formed then it has a distinct legal personality, that is, the acts of the directors
are considered as the acts of the company and any liability arising there from will be considered
as the acts of the company (Lennard’s Carrying Co Ltd v Asiatic Petroleum Co Ltd, 1915). But,
when there are cases of fraud or sham or presence of enemy element or corporate group or
agency, then, this distinct personality is disregarded by the courts and the veil that makes a
distinction amid the company and its officers is distended and the veil is pierced (Industrial
Equity Ltd v Blackburn , 1977) and (James Hardie, 1989). (Helen, 2009)
When the veil is pierced the repercussion of the acts of the company does not fall upon the
company and the director is held personally liable for the same. The acts of the company become
the acts of the directors and they can beheld personally liable to make the good the loss caused
by them. Thus, the piercing of corporate veil is a very important concept in order to bring justice.

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Bibliography
Eroglu, M. (2008). Multinational Enterprises and Tort Liabilities: An Interdisciplinary and Comparative
Examination. Edward Elgar Publishing.
Helen, A. (2009). Piercing the Veil on Corporate Groups in Australia: The Case for Reform" .
Industrial Equity Ltd v Blackburn (1977).
James Hardie (1989).
Krakowski v Eurolynx Properties Ltd (1995).
Lee v Lee's Air Farming Ltd (1960).
Lennard’s Carrying Co Ltd v Asiatic Petroleum Co Ltd (1915).
Salomon v A Salomon & Co Ltd (1896).
Tomasic, R., Bottomley, S., & McQueen, R. (2002). Corporations Law in Australia. Federation Press.
Tunstall. (2008). Corporate Responsibility: The duties and liabilities of the corporation.